People crowd the midway at the New York State Fair in this file photo from Sept. 1, 2012. The state inspector general's office, in its second investigation of state fair contracting in 18 months, said former state fair Director Dan O'Hara and former state Department of Agriculture and Markets first deputy commissioner Robert Haggerty for showing favoritism to vendors seeking two fair contracts. The inspector general, whose 2010 investigation led to former fair director Peter Cappuccilli being convicted, did not recommend criminal prosecution, but did ask a state ethics commission to determine if Haggerty violated state law.
(Photo by Jim Commentucci / The Post-Standard)

Syracuse, N.Y. -- The state’s Inspector General today released another scathing report outlining improper contracting at the New York State Fair and chastised former fair Director Dan O’Hara for favoring a bid from former colleagues.

The 67-page report, the second in 2 ½ years criticizing state fair management by the state’s top internal investigator, admonished O’Hara and other former top Department of Agriculture & Markets officials for their continuing "flawed" and "irresponsible" actions when it came to awarding contracts for catering and electronic tickets.

Given the persistent contracting troubles and investigations surrounding O’Hara and other top fair officials, Acting Inspector General Catherine Leahy Scott notes that these most recent findings are even "more disturbing."

Then-New York State Fair Director Dan O'Hara opens the 2010 state fair in this file photo. Gov. Andrew Cuomo's office announced Jan. 15, 2013 that O'Hara was stepping down as fair director. O'Hara, who has since been hired by the state to a $110,000 job as deputy director with the state's Division of Homeland Security and Emergency Services, was criticized by the state inspector general's office on Feb. 14, 2013 for showing favoritism to a vendor in the awarding of a contract to manage the Empire Room banquet hall at the state fair. Dick Blume | syracuse.com

"The findings of the instant investigation demonstrate that Agriculture & Markets officials failed to correct previously identified problems," Scott wrote in today’s report.

Scott asked a state public ethics commission to investigate whether Robert Haggerty, O'Hara's boss as the former first deputy director of the Department of Agriculture & Markets, violated state law by steering contracts to favored bidders. But she did not uncover anything regarding Haggerty or O’Hara's actions to prompt her to forward her findings to law enforcement officials.

O’Hara’s predecessor at the state fair, Peter Cappuccilli, was convicted of a misdemeanor crime as a result of the inspector general’s 2010 investigative report.

Today's report points repeatedly to lack of oversight and responsible decision-making from top fair officials, including O’Hara. From broken security cameras and non-existent inventory records to flagrant moves to steer lucrative contracts to favored bidders, the IG report highlights continued management problems at the state’s most-visited facility in the Syracuse area.

Oversight at the fairgrounds in Geddes was so lax, the report says, that top fair officials didn’t realize two workers were living there. When discovered, those in charge ordered the workers to move out but didn’t follow up or discipline the workers.

O’Hara is among four fair officials often criticized in the report. One has been fired, another has retired, and the third was replaced as general counsel at Ag & Markets.

But O’Hara has landed on his feet. He reported on Feb. 1 to a new job at the state’s Division of Homeland Security, where he’s making $110,000.

O'Hara began his new job after top state officials, including the commissioner of Ag & Markets, were informed of the inspector general’s findings.

Thomas Ryan, the former chief of staff at the New York State Thruway, took over the fair operations this month. Ryan, a longtime Democratic appointee who once worked for former Gov. Mario Cuomo, has no direct ties to the New York State Fair. Ryan was not mentioned in the inspector general's report.

Today’s report cited the following improper conduct:

-- Haggerty and O’Hara steered a contract for catering at the fair’s Empire Room to Charlie’s at the Fair, whose owners once worked with O’Hara. Haggerty was fired last year over this.

-- Haggerty engaged in improper contacts with a lobbyist and tried to steer a contract for electronic ticketing to a favored bidder, Veritix. When found out, Haggerty simply yanked the contract request.

-- Two fair workers were using the fairgrounds as their private haven to store personal property and sleep overnight. One of them was living there, keeping exotic pet birds and enough personal items to fill six horse stalls and a pickup truck. The other worker set up a party den, complete with a refrigerator full of beer and wine, couch, an inflatable bed and television. All this behavior happened with at least one fair manager in the know since 2010.

Scott’s findings were forwarded today to the Joint Commission on Public Ethics and the State Fair Advisory Board.

The inspector general, who cannot bring criminal charges, referred to the Onondaga County District Attorney’s office for possible prosecution findings that a former unnamed fair worker stole copper wire from the fairgrounds.

"The New York State Fair is an institution that for more than a century has been an important summer attraction for millions of New Yorkers," Scott said today. "It has a longstanding and proud tradition of showcasing New York's agricultural industry. My office's investigation revealed lapses and vulnerabilities which undermine that same, proud tradition. I am pleased that the Department of Agriculture and Markets accepted our recommendations and has taken steps to implement them and is continuing to address the problems identified."

Aubertine responded by letter to the report on Jan. 24. He said the Office of General Services has formed a joint working group with Ag & Markets to oversee contracting. OGS has assumed all contracting responsibility at the fair, according to the report.

Additionally, Ag & Markets will hire a business manager for the fair, a job vacant since 2009. An internal control officer is being added, and the Ag & Markets internal auditor now has expanded authority over the fair. By March 31, the agency intends to hire an outside auditor to conduct a financial and operational audit of the fair.

As a result of today’s findings, O’Hara and other local fair workers mentioned in the report below were disciplined or counseled, though the report does not explain what this entailed. None of the local fair workers were fired.

O’Hara was appointed fair director in 2007 by then Gov. Eliot Spitzer to oversee the state fair, which attracted 850,000 people over 12 days last year.

The job is largely seen as the top state appointment in the Syracuse area, coming with the power to award jobs and lucrative contracts.

During O’Hara’s term – and because of past investigations – the governor and legislature stripped much of the power the fair director held over budgeting, contracting and other management issues.

Despite those changes, the IG reported today, O’Hara, Haggerty and others continued to mismanage certain fair contracts. The inspector general also alleges former Ag & Markets attorney Michael McCormick provided "inaccurate and misleading" information once an investigation was underway. McCormick retired from the state late last year.

A report in 2010 concluded that state fair officials had wrongly awarded contracts for wireless service, concert booking and a boxing event. O’Hara was criticized in this report for his lack of understanding of state rules governing contracting.

The same report led to the criminal prosecution of O’Hara’s predecessor, Cappuccilli, who ultimately pleaded guilty to a count of official misconduct.

The next year, a second inspector general’s report discovered that a former deputy commissioner at Ag & Markets had tried to direct a farmland protection grant to certain applicants. That commissioner, Jerry Cosgrove, was fired.

Haggerty and other fair officials implemented new standards for awarding contracts in the wake of Cosgrove’s dismissal. But Haggerty failed for follow the new rules, the IG report says, by directly watching over a couple of new contracts. "In doing so, he acted inconsistently with not only his own states reforms, but also the agency’s newly implemented procurement practices," today’s report says.

Ag & Markets officials have agreed with Scott’s findings, including reviewing all current contracts, retraining agency staff on contracting rules and ethics and instituting periodic audits of fair contracts.